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Tuesday, July 20, 2010

Day 92 BP Oil Spill: Sparse News; House Hearing; More Monitoring

Jul 20: Neither the Unified Command or BP issued a news update for July 20. In a very brief announcement BP reported that the well integrity test is ongoing and active monitoring continues. Currently the well remains shut-in with no oil flowing into the Gulf; any significant change to the operation will be announced via a press release. BP said the pressure continues to slowly increase and is approximately 6825 psi. A new "static kill" method was apparently suggested by BP and discussed in various media reports and at the House hearing below. The method would involve injecting mud at the top of the well and sealing it similar to the former "top kill" method that failed previously.

The House Energy & Commerce Committee, Chaired by Representative Henry Waxman (D-CA), Subcommittee on Oversight and Investigations, Chaired by Representative Bart Stupak (D-MI) and the Subcommittee on Energy and Environment, Chaired by Representative Ed Markey (D-MA) held a joint hearing entitled, "The Role of the Interior Department in the Deepwater Horizon Disaster." The hearing examined the Interior Department's actions before and since the Deepwater Horizon explosion on April 20, 2010. Witnesses included: Gale Norton, Former Secretary, Department of the Interior, 2001-2006; Dirk Kempthorne, Former Secretary, Department of the Interior, 2006-2009; and Ken Salazar, the current Secretary, Department of the Interior.

In an opening statement full Committee Chairman Waxman confronted Secretaries Norton and Kempthorne and said, "We will learn that the Department of Interior under both President Bush and President Obama made serious mistakes. The cop on the beat was off-duty for nearly a decade. And this gave rise to a dangerous culture of permissiveness. . . What makes this hearing unique is that we will also be hearing from his two predecessors, former Secretary Gale Norton and former Secretary Dirk Kempthorne. This will allow us to examine the recent history of federal drilling regulation, and we thank them for their cooperation.

"In many ways, this history begins with Vice President Cheney's secretive energy task force. The energy task force was initiated during President Bush's second week in office, and for weeks it met privately with oil and gas executives and other energy industry officials, whose identity the Administration steadfastly refused to disclose. Four months later, the Vice President released a report describing the Administration's new energy strategy. The report directed the Interior Department to 'consider economic incentives for environmentally sound offshore oil and gas development.' As recommended in the report, President Bush immediately issued an executive order to 'expedite projects that will increase the production of energy.'

"Secretary Norton led implementation of the Bush energy policies at the Department of the Interior. She promoted new incentives and royalty programs to encourage drilling. But, she failed to act on safety warnings about blowout preventers. And she rejected proposals to strengthen standards for cementing wells. Those decisions sent a clear message: the priority was more drilling first, safety second. Secretary Norton left amid the scandals involving Jack Abramoff to work as a general counsel for Shell, a major oil company. Her successor, Secretary Kempthorne, oversaw the Lease Sale to BP of the future Macondo well. Secretary Kempthorne also oversaw the deeply flawed assessment of potential environmental impacts associated with this lease sale, an assessment that did not anticipate the possibility or impacts of a catastrophic subsea blowout. As a result of those environmental assessments, BP did not have to include an oil spill response discussion, a site-specific oil spill response plan, or a blowout scenario in its exploration plan. . ."

Rep. Waxman also criticized the Department under Secretary Salazar and said, "As a Democrat, I hoped the Obama Administration would do better and, in some ways, there have been reforms. The scandal ridden royalty-in-kind program was cancelled. Secretary Salazar instituted new ethics programs. And in the Department's budget, Secretary Salazar requested more inspectors for offshore facilities. But there is little evidence that these reforms changed the laissez-faire approach of MMS in regulating the BP well. MMS approved the drill plan and changes to the well design that we have questioned during our investigation."

Former Interior Secretary Norton said she was "deeply saddened and appalled by the Deepwater Horizon disaster." She said, "I urge Congress and regulators to respond in a balanced way: take strong action to ensure safety measures are in place and that industry complies. Devote more resources to research and preparedness for oil spill response. But do not impede America's energy security or destroy processes that have worked well in the past." She concluded, "America has been at the leading edge of offshore safety and environmental protection. We have suffered a devastating setback. Lives have been lost. Whole communities have been affected. The environment has been seriously impacted. We should strive to learn from the mistakes and make sure they never happen again."

Former Interior Secretary Kempthorne testified that, "My responsibilities as Secretary ended 449 days ago. . . As you can appreciate, I cannot provide any insight about the exploration plan and the many dimensions of the application for the permit to drill which culminated in the Deepwater Horizon accident because these were evaluated and approved after I left Interior. . . Before the Deepwater Horizon accident, there was a 40-year record of environmental protection in offshore drilling. The last major oil spill from a platform occurred in 1969 near Santa Barbara, California. As the Interior Department had stated  on various occasions  before the BP accident, 'natural cracks in the seabed cause oil seeps 150 times larger in volume than oil spilled due to OCS oil and gas activities.' This record of environmental protection occurred when Republicans and Democrats at controlled the Administration and the Congress. . ."

He said, "I recall being pointedly asked during Congressional hearings why Interior wasn't doing more to expand offshore energy development, not less. In part this concern was driven by the then soaring $4 a gallon gasoline prices." Kempthorne closed with two final thoughts: "First, as a former governor, I urge Congress and this Administration to work closely, hand-in-glove, with the Governors of Mississippi, Alabama, Louisiana, Florida and Texas. These Governors, Haley Barbour, Bob Riley, Bobby Jindal, Charlie Crist, and Rick Perry, are proven leaders, passionate about their states and their citizens, and pragmatic about finding solutions. They and can be essential allies to clean up the oil spill. . . Second, the consequence of the Deepwater Horizon accident is that it will forever change the offshore energy industry. Never again will a Cabinet Secretary take office and be told that more oil seeps from the seabed than has been spilt from drilling operations in U.S. waters. Never again will decision makers not include planning for events that might be low-probability events, but which, in the unlikely event they occurred, would be catastrophic."

Representative Markey asked questions about new "static kill" procedure and reminded that BP must pay a $4,300 fine per barrel in the case of gross negligence. He has sent a letter to Coast Guard Commandant Admiral Thad Allen seeking more information on the testing of the Deepwater Horizon/Macondo well and on the status of any potential decision to keep the well closed permanently. He is concerned that shutting of the well would potentially end the possibility of doing any final analysis of the flow rate of the well by collecting 100 percent of the oil into ships on the surface.

Access the hearing website for links to Chairman Waxman's Opening Statement, Chairman Stupak's Opening Statement, a Briefing Memo, Supplemental Memo, all testimony and a webcast [available soon following the hearing still in progress at press time] (click here). Access a release from Rep. Markey and link to his letter to Allen (click here). Access the new RestoreTheGulf website for links to the latest Unified Command updates and more (click here). Access further updates from the BP website (click here).